Trading Update
In terms of the Listings Requirements of JSE Limited, companies are required to publish a trading statement
as soon as they become reasonably certain that the financial results for the period to be reported on will
differ by more than 20% from that of the previous corresponding period and/or a profit forecast for the
period to be reported on.Accordingly, a review of the financial results for the year ended 30 September 2009 by management has
indicated that the loss per share is expected to be between 11.10 and 14.10 cents and the headline loss per
share is expected to be between 10.72 and 13.92 cents compared to the earnings per share of 15.0 cents
and the headline earnings per share of 16.0 cents in the previous corresponding period and the forecasted
earnings per share and headline earnings per share of 22.2 cents for the year ended 30 September 2009, as detailed in the pre-listing statement dated 25 September 2007.
These results can be attributed to a combination of:
- The cost of the BEE transaction entered into by RACEC and the reporting requirements of International
Financial Reporting Standards, including fair value adjustments associated with the consolidation of Solethu
Civils Holdings (Proprietary) Limited in terms of SIC 12, as detailed in the circular to shareholders dated 29 June 2009; - The delay in the awarding of several significant contracts which were expected to be awarded and commenced in the second half of this financial year, that are now only starting in the first half of the 2010 financial year. Despite these delays the order book remains strong; - A significant once-off contract loss which was incurred. This contract has subsequently been completed, and as such, the loss will not re-occur; and - The general economic down-turn and its related impact on RACEC`s business.
Management has implemented several cost saving initiatives, the benefits of which are expected to be realised in the 2010 financial year.
For comparative purposes with prior periods, if the impact of the consolidations of Solethu Civils Holdings (Proprietary) Limited, as required in terms of SIC 12 is removed, the “normalised” earnings per share is expected to be between 1.29 and 1.57 cents and the “normalised” headline earnings per share is expected to be between 1.62 and 1.98 cents.
The financial information on which this trading statement is based has not been reviewed or reported on by RACEC`s auditors. RACEC`s financial results are expected to be released on SENS on or about 18 December 2009.
Cape Town
7 December 2009
Designated Adviser
Merchantec Capital
Date: 07/12/2009 15:09:06 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
